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tv   Squawk on the Street  CNBC  February 23, 2024 9:00am-11:00am EST

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nothing's good >> feels that way, doesn't it? except for "squawk." >> "squawk box" is good. you're okay. unhinged "squawk box" okay with you? let's do it on monday. >> make sure you join us on monday for another version of unhinged "squawk box." "squawk on the street" begins right now. have a great weekend, everybody. ♪ good friday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the new york stock exchange david faber has the morning off. we put this barn burner of a week to bed today, coming off the s&p's best day in more than a year, post-nvidia. yields are a bit elevated as jpmorgan and goldman make hawkish adjustments to their rate forecasts our road map begins with nvidia versus the fed fed officials yesterday signal no rush to cut rates block shares are surging ahead of the open. company reports a surprise profit, some strong revenue
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growth, and warner bros. discovery today turning a full-year profit but sees continued ad headwinds and shrinking north american subs. let's begin with the markets, though, after that nvidia-fueled rally, jim i think we're going to flirt with $2 trillion today, jim. >> it's interesting that the stock continues to climb there was nothing new that came out overnight. i think that what's happening is the idea that everything's overblown, the idea that there is nothing to a.i., or if it's a.i., then it's latiterally jus something we talk about -- the daughter dross added to intuit's conference call. we're discovering, no, it's actually substantive people are clamoring for it. my favorite part of the whole conference call was the sovereign. the sovereign notion, that you can't do your country's culture in english you have to have your own
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sovereign statement, and colette kress, the unbelievable by good cfo, will tell you there's still a lot of countries that haven't even thought about it. >> i was thinking of other business models where your product is not fungible from international market to market >> i mean, this is -- it's almost -- look, i think one of the problems people have with this is they think that jensen just came up with this but jensen's been thinking about this for maybe ten years for the 200 that's coming out. there will be a 500, and he started thinking about that probably in 2018 we'll know a lot about it when he speaks march 18 to 21, but what's really dawning on people is that they can't live without something they didn't even think they knew about, and companies -- like, if i were mcdonald's right now, i would be saying, get him on the phone or get servicenow, because mcdonald's may not even think they can do it, and let's get rid of the person who answers the drive-thru but this was something that he thought of five years ago.
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why do you have a person who speaks only english answering the drive-thru with possibly 27 different languages coming to you of which the error rate is incredibly high? so, let's just go save that person and have it be nonhuman, and people will be very happy because that person will say, what language do you speak i think mcdonald's is right now saying, who's that guy is that the guy -- is it sensen? that's what's going on and i happen to think he's very good i'm just saying it seems like it's out of nowhere. but he's been begging people to at least listen. begging people and now people want to beg him and good luck. >> one thing that people started to put together yesterday was the activity in nvidia, meaning their business activity, and financial conditions meaning, the more they go, the hotter economies run, and the more we get commentary like the fed gave us yesterday. >> i think that if you're going
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to do wholesale replacement of all the technologies in the world, basically going from cpu, which is intel -- and remember, at the beginning, they talk about, listen, moore's law is dead that's gordon moore. he really was the creator of moore's law, and he started intel, which is that every two years, things double, and they go down in size. that's over. that's no longer advantage pat gelsinger would say that's untrue i have said over and over again how nice pat is. i believe what's going on here is a recognition that maybe everything that we have, everything has to be replaced. because it's 20 times faster it burns less hot. and it has a better return on investment so, let's just rip the stuff out. he even talked about how right now, the -- all the big companies are -- they're changing the way they depreciate, because they don't want to buy more cpu now, the great thing for those who are thinking, well, wait, is this game, set, match? amd has another -- they have a
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different and good piece of metal, but they don't have all the software stack that's in it. even though jensen was very conservative, saying he'll do a billion dollars in software. you want to tie the software in with the product they have every vertical figured. that was another thing we didn't realize. they got a health vertical, a finance vertical let's say you're jpmorgan. you're big enough, you'll just call jensen and say, what do we do we need fraud detection. most companies will go through a ser servicenow they'll go through google, ask what to do >> right, right. >> microsoft remember, just a few months ago, everyone talked about they had an nvidia-killer and nvidia was, like, bring it on, man. we need more chips hey, i understand google has an nvidia-killer, and they say, we hope so, we can't meet the demand for google. people don't understand anything about these guys they are so not masters of the universe i don't know if you watch masters of the air
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they're clearly not masters of the air. they want to be master of that great buffet on friday night >> you're talking about a gut renovation of the entire i.t. stack, but the question, then, is, how large is the halo effect going to be? do people buy palo alto off this because despite some of the disappointments in other areas >> i think what will happen is we'll go back to the fed i think if everything changes, you're going to have -- you don't have enough people in our country. you don't have enough cybersecurity in our country you don't have enough hardware in our country hardware, meaning, steel if you're going to do every datacenter over, but you're going to have to and one of the things that jensen told me years ago was, the largest market in the world is manufacturing, and we're going to basically change the way people -- >> you mentioned that yesterday. >> that's a $40 trillion market. there isn't anything that it can't touch. and you go over just every --
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every conference call last night, square, intuit, you go over bookings, they're all just talking about, look, how much we have in terms of a.i., and they are -- they're early adopters. everybody we have is an early adopter. and yet, they're nothing, because the stuff that -- they still have cpus. the great thing about arm, by the way, which you say, well, you like arm, that's cpu they work very closely with nvidia that's rene haas, who has worked with jensen and is such a great man. i wish we didn't have that damn softbank lock-up i would say, here's your suite you buy that you buy arm. you buy nvidia you can buy amd if you want to have a second source and i say that because lisa su is so good and will remind me of their import, but will never say, listen, we've got something better than the 200. never say that the 200 is really big. >> meanwhile, jim, this morning, your comments on social media,
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talk about what you called a vibrant middle class, which is getting reflected in livenation and rcl and carvana and even hyatt today. >> livenation. do people like rapino? benioff has introduced me to everyone at a party, and he stayed until 3:00 at my wedding. he said, at 3:00, where are we going? i said, i want to go home. he said, come on, you guys livenation was an amazing conference call, because what are they talking about he's talking about record level, record level, record level usher could have been in stadiums, made decisions, justin timberlake, bad bunny. this conference call -- toaylor swift, not mentioned jensen huang, not mentioned. i thought he -- when i was finished with it, i was ready to talk to my kids, and as cool as
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i -- this is it. this thing could make zuckerberg -- zuckerberg's cool in that video. i absolutely love the livenation call, because he basically says, one. amphitheaters. >> arenas and amphitheaters. revenue up 36. that's a blowout concerts up 34 >> take a look at that cpi what did they say was the hottest thing? ticket it's going up. this says it's going up, and i just say, oh god, jay, i'm sorry. i'm sorry, jay it's amphitheaters >> you don't blame waller yesterday for saying, i need more to know whether january was a speed bump or a pothole? >> okay, i think that waller was -- these guys are not eating crow that's a -- i don't want to make fun of these guys. these guys are very serious, but if they do look at bookings -- look, bookings is down because they had israel year over year, and israel is out. not out -- just they're not a
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lot of business. i don't mean anything more than that when you look at what's going on with carvana and the use of square, and you say to yourself, well, look, people who make between 50 to $125,000 are spending their darn fool heads off, and i don't want a fed guy to get in the way of the fact of something i disagree with brian moynihan on. brian's talking about, listen, jim, people are not going to be getting payments that's what you should be worried about. and i come back and say, i'm not worried about anything, which is the real problem i mean, other than big lots, is that really it a couple of rite aids? >> you got barry sternlicht continuing to issue his warnings >> barry, incredibly nice. >> you don't sense any risk or danger in commercial real estate or regional banks? any of the hot spots we've watched? >> some guy from valley nat was on yesterday, new jersey guy, and new jersey is tough, but no. i'm not. it would be a godsend, because that would make it so we would have a rate cut. look, there's -- they built
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buildings that need a huge amount of work what can i say i tried to get an office in this place, and it took me a year old buildings are not the great place to be able to have a.i but it's just old buildings, and they cost too much to convert. but this whole notion of the trillion dollar worry, well, maybe that's what got people to think that there would be five cuts but it's -- we can't even find where the worry is when it comes to publicly traded things. >> that's certainly behind goldman's move today they push out the first cut to june, now looking for four cuts today, prior five. they see the same terminal rate. >> they shouldn't do that stuff. it makes no sense to do that you know what they're doing? they're doing a ten-team parlay, and they forget that arizona turned out to be -- didn't do the cut. i'm not -- it's a ten-team parlay let's get jason robins on the
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phone. and see what he's using. i mean, honestly he's the ceo of draftkings this game -- >> up big today. >> yes, upgraded, and should be. this stuff has to stop you just don't want to do these ridiculous projections just be like jay, okay be like jay, and say, we're going to look at the data. to say three or four, i mean, you're going to get there, and what's going to happen is we're going to see southwest air say business travel's back, and then they're going to have to take it back i read every one of these conference calls, i almost said stupid, but they're not, and it's so clear that people are spending and spending, and i don't know where the weakness is i asked -- i've been asking all the ceos that come on, can you please tell me something that's cheaper this year than last year i have to tell you, rich galanti, the retiring cfo of costco, does have a list i do think that if you dig down with doug mcmillon, when you see that those -- those black combat
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boots, women's black combat moots are now like eight bucks >> general merchandise >> the sunglasses that were $12 are $6, and they're cool as all get-out, and the valentine's day sweaters sold like hot cakes, but they keep lowering the price. when you go into your walmart, it says, rollback, and my kid's, like, do we need this? it's like, roll back everything rolled back is actually rolled back they're serious. >> meantime, we can't keep our eye off of geopolitics today got some news out of washington today. good morning, carl we've got details on those new sanctions the biden administration is announcing against russia this morning. they'll be targeting more than 500 individuals and companies with the goal of slowing the economy and limiting access to weapons and the materials that russia needs to build them now, some of those measures will be aimed at reducing energy revenues they'll be focused on enforcement of that $60 price cap on oil the goal here, they say, is to
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make it more expensive for russia to circumvent that price cap. a few other highlights they'll be taking aim at russia's financial sector, including nspk, which operates russia's national payment system there will be export restrictions on about a hundred new entities, and importantly, these sanctions are not only on companies in russia but also on those in third countries doing business with moscow so, think china and india here treasury officials say they have been in touch with beijing on this, with the message that if you do business with russia, we will sanction you too. now, the state department is also targeting individuals directly tied to the death of russian opposition leader alexie navalny, and overall, guys, it's a big question of just how effective these sanctions are going to be, but the goal is to cut down on the evasion of the sanctions we've seen so far to increase costs and reduce revenue. >> thank you obviously, targeting, jim, energy revenue, marking the second anniversary of this war >> look, it's one way to do it the other way is to give them
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the missiles and the planes they need, and that way, there would be a much better, authoritative way to be able to stop this, because obviously, the sanctions have been meaningless. when i say meaningless, i mean, like, wow, step up the russians' game there's a lot of people who are beginning to remember what the russians were like in world war ii they were -- they're ingenious when it comes to stretching their resources. so, i think that we're not recognizing these are -- this is about finance. that's not going to stop them. >> big opinion piece on the tape this morning looking at history where you thought the russians were counted out, and they managed to find some well of resilience and reassert their threat over the longer term. >> yeah, 1942 in ukraine i mean, the -- you had operations where they captured 600,000 russian soldiers and 3 million russian soldiers murdered and it didn't matter 28 million soldiers and civilians die in world war ii,
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and the russians kept coming we have to start realizing who -- we're funding ukraine you have to start realizing that the russians don't play by -- they have never played by the rules. they're willing to lose. it seems like there's almost no unacceptable loss. so, you do these sanctions, putin says, money? money? with stalin, money that doesn't mean anything >> exactly big headlines here, but you can imagine what the sentiment is in poland and germany when we come back, a lot of corporate news to chew on today. the streaming picture for wbd, companies out with quarterly results. futures are hanging in there, even with the digestion from i yesterday's 2%-plus game, the first one for the s&p in 281 trading sessions a car is a car...
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bottom line, we're a far healthier company now, and we're building real momentum and we expect 2024 will be a year to drive that momentum forward even further that said, this business is not without its challenges among them, we continue to face the impacts of ongoing disruption in the pay tv ecosystem and a dislocated linear advertising ecom is ecosystem. >> warner bros. discovery's david zaslav on the call moments ago. weakness in ad revenue, down by 14 d to c subs in the u.s. and canada declined slightly but grew on a global basis they are the first hollywood media conglomerate to report an annual streaming profit. that's $123 million for '23 and they do see a billion dollar ebitda for max in 2025
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>> they bought back debt, which is important, and you can point-blank say adjusted ebitda was not bad. here's the problem jim stewart had some comments, saying, look, this would be the last quarter that actually benefitted from a writer's strike, and we see what it looks like far be it from me to go against james. i thought that was very meaningful interview that he gave >> does that explain the beat on free cash flow in this quarter >> i think so. >> just the savings you did from no production? >> yeah. that's what jim pretty much implied, and i'mgoing to go with jim on that obviously, i think that everybody would like to see -- in our business, would like to see linear tv do better, but tv revenue declined primarily due to the impact of the strike and certainly large licensing brands, but then, i mean, it's just content revenue decreased 20% ex-fx. this is the problem of, people aren't watching linear tv. this is the, i call it, the fire
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at the hospital cop show that was the 1980 memo that everyone said you had to follow, and that no longer -- and by the way, no one seems to even accept that the fire at the hospital cop show is not the formula anymore. even though, as we look at netflix, like, everyone just should own netflix they have no theme park. when you watch them, it's not a fire at a hospital with shooting that's the point america changed. the world changed. i mean, you can go watch something that's made in uruguay and be blown away, for heaven's sake >> net leverage south of four. ordinarily, wouldn't the street applaud that >> well, yeah, but they -- they don't watch it it's like new and improved dog food dogs don't seem to know it >> we'll keep an eye we're going to get paramount next week as we continue to roll through some of these quarterly earnings when we come back, we'll get cramer's "mad dash," countdown
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to the opening bell, one more look at futures. looking green here on this friday after a heck of a week. back in a minute you know doug, ever since switching to workday you've been a real rock star. rock star? what do you know about rock stars? billy idol? i mean where's the skin-tight leather? my shoes are leather. where's the unnecessary zippers? that thing! billy, rock star is just how doug feels when he uses workday. thanks, rory. i'll show you rock star! be a finance and hr rock star. workday. for a changing world. billy idol just stole your golf cart! hi, i'm sally. i'm from phoenix, arizona. i'm a flight nurse on a helicopter that specializes in trauma. i've been doing flight nursing for 24 years. as you get older, your brain slows down
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we need strength and comfort. take a look at the premarket here we closed yesterday just a
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stone's throw from 5,100, which was, of course, goldman's year-end target until a few days ago. best day in more than a year for s&p, nasdaq, and the ndx we'll see what we get when the opening bell rings in just about four minutes to duckduckgo on all your devie duckduckgo comes with a built-n engine like google, but it's pi and doesn't spy on your searchs and duckduckgo lets you browse like chrome, but it blocks cooi and creepy ads that follow youa from google and other companie. and there's no catch. it's fre. we make money from ads, but they don't follow you aroud join the millions of people taking back their privacy by downloading duckduckgo on all your devices today.
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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. time for cramer's "mad dash" as we count down to the opening bell >> a company you know very well, mcdonald's, i mentioned them earlier, i think it's terrific everyone said the quarter was bad, and the stock is up above it they watch the show, and they want to thank me for the shoutout, and they say, i think this is very good, "rest assured we're all over the a.i. opportunity at mcdonald's. we're currently testing voice recognition at over 100 drive-thrus. they have 150 million loyalty members. i think it's very important that people understand that they use large language models helped by ibm and google they're not building it themselves but there it is right there. ibm and google, certainly they're amazing companies, but what do you build everything on? you build things on grace hopper you build things on the n-200 or
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the -- the h-200 or the h-100. i want to applaud jensen and applaud mcdonald's for watching. right now, you think that the other guys can possibly risk not having this? >> that's a great way to help people explain what's coming >> yeah. and again, if someone says on this show, something that's not responsive, i correct immediately. those numbers were amazing i have no idea why people thought those numbers were bad no idea. >> let's get the opening bell. at the big board, it's madison square garden entertainment celebrating the harlem globetrotters at msg tomorrow. at the nasdaq, lotus technology, a luxury ev maker, celebrating a listing today via spac >> ev. ev what's that stand for? ev >> electric vehicle. you've heard of then them hey, jim, tesla's working on
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revisiting 200 >> tesla is different. that's a technology company on wheels that is going to put out -- they've got a new iteration coming up. boy, the long knives are out for rivian oh, my whenever you see that buy to sell oh, my god that was brutal. and when i saw, what, ubs? it was so brutal it was -- it's a linear tv show. evidence left. the ubs, they go -- they think the strategy's onerous, $8 price target they loved it until they reported unbelievable >> went from $16 to $11 yesterday. >> now the georgia plant -- you know that phil -- that was such a great interview. you can learn from phil. what is the bone of contention can they do the big georgia factory? what would typically most
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reporters not want to ask about? >> he would not let it go. you can see nvidia tops $2 trillion. >> oh, okay. >> so, we got that >> big mcdonald's contract >> got apple actually, interesting note from kostin this morning about large cap funds leveraging pretty effectively this dispersion within mag seven, underweighting tesla and apple, for example >> kostin's fighting, people want to find different things. i say when we get definitive vision pro numbers out and we found out there aren't enough and we start getting a lot of new things being written for it and when we start making it so it connects to your apple tv, then people will be saying, you know what? i misjudged the vision pro they won't say that. they'll say, turns out the vision pro is as good as i thought. no one ever -- there's so much crow-eating with apple, it's like the audubon society
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>> they were talking about rule of 40. servicenow, rule of 70 one of the things that's great about -- the opening line of the conference call, which was brilliant, we're under our 12,000-people cap. now, talk about zuckerberg taking the power of ten. zuckerberg squared >> remember, we talked a couple weeks ago about the bti upgrade, more involvement from jack dorsey >> jack dorsey wrote everything about it >> i think we're all guilty of that >> i do think it's a remarkable company. i've told people, don't get in the way of it. they have too much of an ecosystem. they use ecosystem lot of people use platform i'm a platform >> platform? platform guy >> my travel trust is a platform >> speaking of which, booking holdings, of course, jim, it's been coming off of all-time highs, but they do guide a little light here on bookings for q1 >> for 16 minutes, that stock --
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no come back to that stock 18 days from now, and it will be up. it will take about that long you have to really go through the lines and realize that israel was incredible. people are traveling like mad. so, go ahead, sell it. be my guest. >> initiating a dividend as well >> yeah. big dividend what, north of eight i thought glen did terrific. glen, by the way, is not promotional, and i think he could have been much more bullish. if i were his advisor after, i would say, glen, you probably want to be a little more positive when you're on next, because you see, expedia is doing a bad job. you could do just a little bit more of a -- this is what we have going for us. instead, i wanted to go buy airbnb after i listened to him >> i know you want to get to carvana as a play on what the consumer's thinking and feeling right now. >> garcia's got the pulse of the country. he also has the pulse of the short sellers. 32% of the float is short. he's making -- the big rap
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against him is he loses money on everything he sells g guess what he makes a ton now on everything he sells when the stock was at seven bucks, i said, i have disliked this thing, but it is time well, it was >> first annual profit they see adjusted ebitda above $100 million >> they have 1% of the market. i want to go -- there's a really good carvana vending machine in philadelphia i'd like to go there, maybe do something with comcast and -- our parent company, comcast -- and then just go to the store there. the letter to shareholders is a nice joy to read path to profitability. very well done they just blew it away and they have -- they've got this five pillars, which i think everybody should read, because it just shows you how you can take a company that people thought was at death's door and crush it >> right >> i know we mentioned draftkings earlier, up 2%, little upgrade out of barclay's, overweight, they go to 50.
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they're basically raising their forecast for digital gaming t.a.m. >> what you typically have, post-football, is a dropoff, and then they can come back. j jason robins, the ceo, is not making money it will be a hockey stick. you'll get a couple states that go for it. right now, there are whole states where you can do -- you know, kind of player prop deals. daily fantasy. you can't do the actual money. they'll get those, and it will be very, very big. and parlays -- people don't understand people love parlays, which used to be called parlays, but now their parlays. and i think robins is doing a remarkable job i did have a job with draftkings at one point, "bull market fantasy," and people say, jim, you're a homer look at the chart. i recognize that thing as a coiled spring when football came look, there was absolutely nothing to that trade. i came on and said, listen, football's going to start, the
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stock's at $20, go buy the stock. people just gamble, and there are a lot of people, unfortunately, who are gambling away everything. >> yep >> and that's -- you know, that's people who are buying the nvidia, what -- what strike were they buying? a thousand dollar strike yesterday that expired today now they're doing a 42-team parlay involving every team in every sport. >> you can chart out nvidia call volatility, and the nasdaq vix and they went like that. >> i have an idea for those people own it, don't trade it i mean, what -- they obviously have not -- i mean, there is, again, there's an ethereal nature to jensen, who i'm told actually thought that the swift -- taylor swift analogy was -- trying to get people to understand who he is taylor swift also comes in peace. very quickly, he talks about coming in peace, because there are a lot of people who feel that he charges too much look, he doesn't the return on investment is so
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high so quickly. he's a renaissance person. "the new yorker" article was really great that's if people want to get to know who he is but what's -- his answer to the first question in the conference call was so brilliant. just tell people to go do it i'm not going to summarize it. i'm not going to chatgpt it. >> we got 5,100. we're being led by tech, obviously, but you know what's close behind are banks, and even jpmorgan up even on news of dimon's stock sale >> he should have sold twice that the banks are really in some sort of sweet spot people want -- i think that that buy, that, you know, the capital one discover made people think that maybe this group is cheaper than it should be, because that's how richard fairbanks, so smart. he did a little video, if people want to go to the website, he did a little video about why he's doing it. it was pretty good i remember when charlie scharf, wells fargo, big holding for my trust, we had to sell some
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because it became the biggest position on the last quarter, he talked about commercial real estate not being a factor, and then i matched that against barry sternlicht, and i say, okay, i would have thought that wells was the one that, if they're going to have it, wells is going to have it, and instead, the balance sheet is really clean at wells. i only mention that because the balance sheets are -- we're just not having a lot of degradation. we're not having a lot of credit losses >> remember the big morgan stanley large cap bank upgrade, biggest excess reserves in decades. >> i did -- terrific story it's just that what happens is people get bored they want super micro. everybody wants super micro. you know, i was telling a lot of -- you know, the guys who really bet, i mean, that's the one. you want to go play that game? go ahead i got a thousand in the back i see a thousand check the thousand do i have 100,000 in the front that's what that thing is. it's a gigantic auction. >> today's decline is basically
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reflecting this note offering and the potential for dilution, right? >> i had them on there's no doubt about it, it's a real company they were on at $400 and a month later it was at $900 at the same time most companies were within 2% to 3% >> how do you explain to viewers the difference between the action in nvidia and the action in supermicro? >> i think it has a lot to do with float and a lot to do with the idea that people recognize this is a wild trader. we have -- we got away from the wild trader idea as things settled down, but this one is the one, if you were -- if you were just wanted to go play calls, just knock yourself out i mean, i bet you robinhood, i bet you a huge percentage of their trading of calls is supermicro remember, between calls of crypto, robin, that's, by far, the majority of their book of business >> right i hesitate to mention intuitive machines, but we did have the lunar landing.
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it's a billion dollar market cap. but i mean, is this a sign of froth when you're getting 20, 30% gains? >> no, because their balance sheet is actually really good. and because their balance sheet is good, i'm going to say, no, it's not fraud i don't -- i mean, if elon musk lands something on mars, then the moon is going to look like a nothing. remember, jensen is calculating the speed of what you have to go to land on mars. it's constantly -- it was constantly behind his desk >> yeah, you mentioned >> do you remember -- this is the quiz -- what has jensen not solved >> what has he not solved? >> what has he not solved in his life or hadn't when i was out there last >> tell me >> black ice can't seem to -- >> the self-driving -- the kryptonite for self-driving technology >> people don't understand his humility is -- his genius is only topped by his humility, and it's really fabulous out there where everybody just thinks, oh, they look at his resume, and
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it's, where did he finish at stanford in comp sci nowhere. and then jensen doesn't care about that at all. >> yeah. denny's is the thing that's most closely associated with him, of course >> the grand slam is fabulous. my mom had that for rebbreakfass her last meal. good for her no, she didn't she had the big mac the day she died can't hurt me at this point. mcdonald's actual true story. >> jim, next week, on deck, workday, crm, snow, okta, best buy, dell, zscaler >> i think that okta is a concern. best buy, the numbers have been derisked people have been cutting, cutting, cutting estimates salesforce, three guys raising price target the last few weeks. the workday ad, people love, and i think that snowflake has got a great story to tell, because they've done a lot with a.i. in the last -- they are, again, the user of jensen's product
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>> so, you really don't see corporate results getting in the way of the bulls' hopes at the moment >> those were all companies that you need in order to be able to get your head count down and having your people be more productive and that's what it's about look at all the companies that have been great. look at block today. look at meta, which had the -- now, of course, eclipsed by the one-day growth, but meta was about efficiency, and it's not just because they're laying people off when they don't have anything meta is probably mentioned as, i would -- if you wanted to parse what was said on the call for nvidia, you would think that meta's the largest customer. you would think that >> well, you could throw in there depot and walmart and toll, right? things that have gone right this week >> the toll quarter, doug yearley is so good, and you're making -- your gross margins went up in housing you had builders last night talking about how to raise the gross margins of a home builder because they can -- will you look at that they bought a ton of stock back
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when they felt wall street did not give them the right pe by the way, most ceos will not talk about pes they say, that's your job. no doug jewyearley said, our stocks too cheap, we're going to buy all the stock we can look at that who bought $9.5 billion worth of stock last year? that's a good quiz >> tell me again >> jensen. $9.5 billion worth of stock last year there's a gamer. he actually is a gamer there's a gamer who's a gamer. >> you know what i haven't gotten you on is reddit and this filing some of the numbers we're get as a result of that >> if they keep losing money, i think the stock doubles. >> revenue up 21, not impressive enough >> they've been in business for years, and i was talking about this with ben. he's been a resident iconoclast and also research director at "mad money." he said what will happen is it will be all negative, but the people who don't know will come in, the stock will be priced at $28, it will open at $47, never trade within a dollar higher, and two years from now it will
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be at $10, and we'll say, why didn't we do something life cycle of r eddit. >> you've seen this movie before, i think. >> a lot and it's a bad movie that's because it was on linear tv and it had no cops or fires there's no paddles you have to have paddles in a linear show, don't you >> the other name that got past us, jim, is intuit lot of price target raises today. >> that is a great user of a.i., and they talk about it constantly, and they do a lot of inference, which is something -- 40% of jensen's business is inference. the stock is down. that's ridiculous. it's two weeks from now, the stock will be up fantastic quarter. just remarkable. someone was saying that, look, his acquisition that he made of credit karma was bad they say that every quarter, and look what the stock does we realize credit karma -- we got a lot of people in the country that are, like, have you checked your credit today? i checked it at lunch. check it now there are people who are addicted to their credit
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i don't know >> remember when you had to ask for a report and print it out -- yeah >> when i had eight credit cards when i got out of law school, i didn't have to look up my credit, because i knew what my fico score was thank god they stop at zero. >> jim, really quick, you've got an eventful weekend coming up tomorrow >> we have our annual meeting. i'm all fired up about it. we'll talk about things like disney that could happen. we're going to talk about frank holland is going to interview me regina, been with bhe for 19 years, we're going to be kicking things around. we're taking questions, and all i can say, carl, is the highlight of last year's was when you interviewed me and mentioned pop. you mentioned my dad i got teary, i admit, but that was because you knew him he loved you so much he just loved you. >> his influence on you continues to this day, jim it's part of why you work as hard as you do, i think. >> when he died at 92, i didn't know he was working. he told me he wasn't
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irs came after him with everything he had because he had a good year. i had no idea he was working >> i look forward to the tomorrow's meeting, though it's going to be good. it's a chance for members to see you in-person, go through the playbook, and it goes all day. >> yeah. and i would do it -- you know, they're making me stop they are they're, like, because they know i have to come to work on monday >> yes, yes. we look forward to it. >> thank you and i thank you again for doing it last year, and it turns out i'm radically different when i'm there than here. >> not really. >> not really. same thing you get what you pay for what are you going to do and i wear a suit too. nothing ever changes i use that brioni to garden last year i had an amazing crop. >> as we go to break, take a look at bonds today. not very much in the way of data or fed speak, but we're going to get a lot next week, including some consumer confidence, revised gdp, pce deflator, umi and a bunch of other numbers record highs, dow and s&p. don't go away.
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for nvidia this morning is going to put it near the top of the s&p list look at the week to date as well nvidia is at the very top up 12 plus moderna is in there as well with some of their reiteration with 24 sales guidance. discover what an eventful week it has been the all kinds of sectors. holding 1500 on the s&p with all-timeig a sp adg hhsndtotrin with jim is up next. at morgan stanley, old school hard work meets bold new thinking. ( ♪♪ ) partnering to unlock new ideas, to create new legacies, to transform a company, industry, economy, generation. because grit and vision working in lockstep puts you on the path to your full potential. old school grit. new world ideas. morgan stanley.
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>> yes. >> how about tonight >> tonight's yield i need. tanger, factory outlet doing incredibly well and exelon i think not everybody watches our shows, people want to have good ideas to have yields and upside give them everything this is not, you know, this is something delightful for something everyone to. >> yeah. very nice. we didn't really touch on energy nat gas with kind of an eventful morning down 5 earlier. >> coterra is a stock we own and they pivoted ctra pivoted pretty hard tom jordan saying it's time to go oil nat gas is what they call it the widow maker and the reason. >> yeah. >> i have to see who else is installing jensen's stuff. >> i imagine companies will reach out and say hey, look at me. >> what he'll do the more the merrier. i think the best one who has that, go speak to the people at
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google you ought to go to the people at meta and see what doing. i mean, look, jensen is a salesperson for ai, and that includes the 100 and the 200, but if you go watch the fireside chat between frank from snowflake. >> yes. >> and jensen, you will see the real jensen and see what value proposition is, and it's so compelling you don't know why everyone doesn't rip out intel's product. >> right. >> there's the market cap. $2 trillion adding a trillion dollars, jim, in four months >> the nouveaux risch. we hate. i don't. i never like scott fitzgerald just for the record. hack john o'hare on the other hand. >> daisy and the green night yes. >> we'll see you tonight have a good weekend. don't forget the annual meeting tomorrow. >> thank you very much. >> look forward to that. we're holding 5100 dow up 175
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. good friday morning. welcome to another hour of "squawk on the street. i'm carl quintanilla with leslie picker here at post nine of the new york stock exchange. sara and david have the morning off. the nvidia led momentum continues today with that stock up about 3%. s&p above 5100 despite some of the hawkish fed commentary that we got yesterday, that's all-time highs for the s&p and the dow. >> we're at 30 minutes into trading. today here are three big movers we are watching starting with shares of block, surging after the company announced a surprise profit and strong guidance sending the stock up double digits up 17% right now. more on the quarter later this hour shares of booking holdings sliding today. the company's guidance coming in below expectations overshadowing
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better than expected results watch shares of carvana up 35% after posting its first annual ever profit. we'll break down the quarter with ceo next on "money movers" in the next hour. >> busy week of ecodata and fed speak, the markets pricing out the rate cut from the months prior. steve liesman has details and can set up next week where we get a little bit more. >> yeah. carl, we marked a milestone yesterday when futures markets priced all of that exubr ber rance for fed easing and stocks have held on to the gains and added to them. ride the fed roller coaster here the exuberance in late november fed governor waller said if it fell they would have to cut rates when fed chair powell at the meeting acknowledged the fed discussed rate cuts at their meetings and markets took off
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helped but better inflation data and markets priced in seven rate cuts this year futures markets start taking back that easing amid strong payroll numbers, higher inflation data and a barrage of fed speak warning against bets on early cuts. at first the stock market rallied with the easing exuberance and then sold off when it looked like the fed would do less. stocks have started to go their separate ways around the middle of january they have embraced better economic growth and those better earnings that's been a big part of the turnaround here and the separation fourth quarter earnings growth estimated at 4.7% in early january now expected to be up 10% propelled by nvidia, the broader tech sector. also other sectors as well what is the less on here, if any? now we know fed futures are highly volatile. the fed needs to be more careful with what they say markets need to listen more carefully for now, it's also that whether you have inflation under
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control, interest rates not seen rising further, and worst outcomes from the middle east conflicts avoided, stocks can trade on earnings and economic growth and the promise of future but fewer rate cuts. last night as if on cue governor waller started this thing back in november and said the fed should be in no rush to cut rates. just one more thing also on cue here, market is doing better look what's happening to the probabilities. march almost an improbability the way the future markets has it lined up. look at may down to 23%. they're starting to worry about december does it happen or june does it happen with about like a 70% chance that's down from where it was. so the question is, how much longer will markets withstand this fewer cuts, but still higher prices and gains in the stock price. >> with goldman going to june this morning as well steve, from march originally thanks, steve liesman today. joining us to break down the markets, research ceo and cnbc
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contributor adam parker here at post nine. good to see you. >> thanks for having me. >> steve's got a great point and the decoupling of equities from the rate environment, is that all because of mag seven or something else >> i was sitting there watching thinking, you know, i kind of am partially responsible years ago for starting this garbage of like good news is bad and bad news is good when i used to work at morgan stanley. i was sitting here thinking, good news is good news and bad is bad you get bad economic news the market will go lower good news we continue to do well no longer all about expectations for interest rates a year from now. we're in this pocket if we get continued decent economic news we don't think things are falling off a cliff and equities look pretty good we're in the normal god forbid good news is good and badnews is bad i know what doesn't work is good economic news is bad for market s for a long time. i get how you get a little hawkish. this was a two-day thing that's where my head was maybe we're good news is pretty
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good. >> does that require kind of a decoupling of the way we think about interest rates and the interplay and what it means for corporate america? because, obviously, with higher for longer interest rates means higher financing costs and affects discounted cash flows out into the future? with cost of capital where it is how is it the market can reverse its thinking on that >> two thoughts. one is, i think that thinking is very recent, like the last year or two back 100 years ago when i was in school i thought what i learned is, if the economy is good, the 10-year yield backs up and the stock market goes up because they're both representative of things improving that's really where the baseline is we've gotten this whole like fed induced all that matters is the fed thing kind of made your point where everyone's mind is the last couple years. the second thing, i focus on t biggest 500 companies or so in the u.s. i'm sure i will get commentary, but the s&p 500 companies don't go bankrupt. basically. one or two every -- so they have high quality balance sheets.
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cost of capital is for profitless businesses, biotech, refinancing the capital market activity it's not when you look at the biggest 100 companies that continue to do well. that's my thoughts on what you said what i thought was interesting was the magnitude of the moves you talked about on earnings, right where, you know, how much these stocks are up. you didn't mention melli, that is down, like big moves going on in earnings, so i'm tired of wh people whining about the magnificent seven. there's ton of stuff going on as you point out in the names you pent to. stuff going on. >> are you saying that russell is outside of your realm of interest >> it's just that it doesn't work unless you think gross margins are going up for the average company. to say you like small caps means you're bullish and think that it's a risk on trade that happened november. why? financial conditions eased and that's all that matters. if you believe we have a broadening rally and everything is awesome you're bullish and think margins are going up for
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companies tharnds estimates going up more than mag seven. >> you written recently you think margins have bottomed. >> that's why i'm bullish on a lot of things. you have to own the mag seven. i don't see how you can take the risk of being under weight that group unless you're wildly bullish. >> about what a just the broader macro conditions here? you basically said a soft landing kind of coming into view here is that more dependent, perhaps, than what we're getting out of the fed with regard to maybe preemptive rate cuts or something like that. >> it's funny if you go to the website and search on powell it says zero search results why? because i have no clue okay i've worked with smart people at big firms and they're not good at it either it's hard and unknowable so i think that's why folks more in the corporate earnings and big companies and i look at the big names the numbers, u.s. equities, earnings numbers are up a lot and that's why i want
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exposure to it the answer to your question it's mixed. i think economic activity looks like it could be bottoming, l.e.i.s maybe a little bottom but the consumer is slowing. it's in good but declining position i think maybe industrial activity could be bottoming when i piece it all together, whatever the couple hundred variables we look at it's okay, but declining how i summarize the economy. but corporate earnings can be a lot better than the economy for all the reasons we talked about. those companies that you go through, like they have power. they have pricing power and cost controls and motes on the technology, they grow their net income 15% plus a year consistently the reason i'm always bullish on u.s. equities and don't like when people say they like e.m. or bonds, get me exposure to the best 20 u.s. equities something better than that, 15% preyear growth thaeptsds been more or less the broken record for the last ten plus years snooi guess. >> nvidia, you were early in getting constructive arguments say it's no more expensive on a
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forward multiple than when the market cap was 300. >> the sales revisions have come up a lot and on ebitda gross profits that's probably true the questions are like is this might crow proser market where it flushes out 80-20 share with amd and the market cap differentials are kind of right where, you know, you're six, seven, times the size of amd or one somebody lose and what percentage of the overall tam can nvidia get you're getting close to the point it's hard for them to grow at a rate that the margins keep expanding. i don't know how much i guess another way, i don't think valuation will be a great predictor of return for nvidia what do you believe the long-term growth rate is and how much share do they ultimately end up dominating. the only thing with micro processors that use a 25-year-old analogy, 5885 --
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85-15 share maybe the market value is right valuation as you know, i wrote about it last week and again like if that's your jam, what you're -- i call it the nvidia god trade. you're saying i don't own it now because i know we're at a peak and then i'm smart, and then it's going to go down and buy it at the bottom and ride it to the second wave of the implementation of cost cutting unintentional arrogance making that call. i'm not that smart, and i'm going to own it the next five or ten years and a basket of other ones and there will be bad quarters and in the end another 10 x and whatever. that's my view for the last year plus and i don't -- i think there's a weirdness to saying i missed the first $2 trillion but i will be god from here going forward. that's weird, night like great summation of some points of view. >> yeah. >> good weekend. >> have a great weekend. as we go to break a road map for the hour including a closer look at block's quarter. blowout number sending that stock surging double digits today. >> reddit officially filing to
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go public at the nyse. the first social media ipo since 2019 we'll tell you what to expect. >> warner brothers discovery sliding post results one of the big laggards on the s&p today. we'll dig through the numbers as "squk t see cties after thisonnu at schwab is now powered by ameritrade, giving traders even more ways to sharpen their skills with tailored education. get an expanding library filled with new online videos, webcasts, articles, courses, and more - all crafted just for traders. and with guided learning paths stacked with content curated to fit your unique goals, you can spend less time searching and more time learning. trade brilliantly with schwab.
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hello dad, hello dad, hello da. uh-oh. good bunnies. ahh! block stunning the street with a surprise q4 profit beat seeing strong revenue growth in its square and cash app businesses our next guest upgrading the stock to overweight from equal
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weight and upping his price target to $95 from $65 joining us now is wells fargo andrew bow andrew, give us a sense of kind of what you saw here that was strong enough to up your price target that much as well as upgrade your weighting here? >> yeah. just to give you a little bit of a context, we haven't been constructive on block for about two years now. this is the second straight quarter they delivered really impressive results, and broadly speaking they've gotten their act together the things they've been doing around the cost discipline side of the story, another strong 4 q, the capex monetization story continues to be on track and the company taking a much more, you know, prudent approach to how it thinks about the margins in the longer term and acknowledging stock-based comp as a real economic cost with the growth algorithm in place for 2024 and seeming how they gave the guidance that left room to the upside we think the risk-reward is in a place where bulls can get excited.
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>> what do you make of kind of the portfolio of businesses? if you read through kind of the commentary from these earnings it feels more like the traditional square point of sale business is now just a footnote basically in the company's growth strategy? i know that's not true, but it kind of feels that way do you kind of like the way that they're focusing this kind of repositioning of the business? >> yeah. i mean, it's a tale of two stories, right cash app is the number one leader in digital wallets and neo banking among gen-zers the square side by them has taken a step back over the last couple years and they did have a leading market position before we entered the pandemic. when you saw all that rapid growth from cash app that's where they put their investment dollars behind now, based on our channel checks and industrial research, we think that gap between the leaders and the pace setters in the physical point of sale space is not insurmountable. it will take time to revert
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callize the sales team, boots on the ground approach for go to market, but we lean into management's track record of impresive innovation in the space and wouldn't put it past them if they close the gap within the next year or so both engines of the story are important for longer term growth you could argue that cash app is the upside driver and, you know, seller kind of sets the floor, but we like that balance. >> would a capital one discover merger, if that were to go through, have any bearing on block itself, just given kind of it makes for a bigger deposit ticking institution, alters the payments universe a little bit >> maybe on the fringes, but neither of those companies are really focused on cash app's under banked target markets and really doesn't have the marketplace that a cash app does today. i think if you look at what cash app's actual drivers are they're kind of internal
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they have 56 million active users, only 2 million of the users are direct deposit paycheck users there's an 80-20 rule applied in fin tech and payments your most monetizeble users are smallest piece of your base really just expanding that direct deposit base is what they need to do to kind of make the model work and i don't think that's going to be impeded by capital one or discover. really other m&a in the space. >> finally, andrew, more of a macro question a couple weeks ago i did see a note from morgan stanley, we don't want to make a mountain out of a mole hill, buy now, pay later is on the rise and bears watching this was a comment on basically household balance sheet health is it something that is worth monitoring >> i mean, it's worth monitoring, but i think there's still a great misunderstanding on how the credit mechanism works for these buy now, pay later companies. affirm, which we cover their duration of these loans are very short, you know, three to four months even, how the book turns
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around, plus, a lot of these loans have direct, you know, pulling funds out of your bank account, so there's not as much of the stacking credit risk as a lot of investors like to assume. in addition also these companies make underwriting decisions on a real-time transaction level basis that's far different than, you know, a young kid going into the mall and taking out a store credit card for just a flat balance they can immediately and inevitably run up. >> fascinating thanks for sharing that distinction with us really appreciate it, andrew. >> thank you so much. still to come reddit officially filing to go public on the new york stock exchange a big test for the ipo market. as we go to break check out some of the biggest gainers on the s&p for the week ucforna outpacing nvidia by a toh r the past few sessions. back in two. not you. you! your business bank account with quickbooks money now earns 5% apy. (♪♪)
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at morgan stanley, old school hard work meets bold new thinking. to help you see untapped possibilities and relentlessly work with you to make them real. checking in on crypto prices this week. bitcoin taking a breather. ether up more than 5% on hopes a new spot etf will be approved for the crypto currency. the second largest buy market cap. the ceo of one of those
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applicants joined "squawk" confident as ever about approval take a listen. >> we do have an application on file, grayscale sponsors etag, ethereum largest fund trust in the world and the spot ethereum etf is a matter of when, not if a lot of crypto enthusiasts argue the bitcoin etf was a catalyst, a stair-step for the underlying price as well. >> a precedence for the bitcoin approval those who are ether enthusiasts would say what's fair is fair at this point. an ipo years in the making taking one step closer to the public market, reddit filed more than two years ago, flipped its prospectus yesterday revealing details about its business and intentions as a public company and expect a valuation upwards of $5 billion, between say 5 and $7 billion and assuming all goes
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according to the working plan we can expect a listing during the first week of april. mark your calendars now. a couple highlights from the financials including a top line growth of 21% to 824 million last year and narrowing of net losses to 98.8 million reddit says revenue came from advertising, and google will be able to pull in content to train ai models and that deal valued at $60 million sam altman popping up, owning 9% of the company, making him one of the largest shareholders alongside co-founder and ceo steve huffman among other vcs. outsized amount of shares will be offered to certain reddit users at the ipo price a move that carries pros and krons. conventional ipo wisdom is to limit the float to trusted long only investors unlikely to flip on day one to ensure a smooth debut giving shares to users, introduces an element of uncertainty but it also allows
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the process to be more democratic and enables more retail investors to participate in the upside. of course that's the if the company, and its bankers lead over the next five to six weeks. now the prospectus is public and they can have conversations, road show kickoff in about a month's time and if you're going to be allocating this stock to your user base you want to make sure you keep them happy with the performance because you don't want people to lose money and, you know, be upset about it and this is a public platform so they can take out their frustrations on the platform and it could havea flywheel effect >> i'm trying think of other precedence where they did reserve a block. >> robinhood is one. >> yep. >> that did go down, but went up the following week pretty significantly. obviously, it's going down since then a bunch of consumer facing companies have these directed share programs for users, customers, and some of the
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platform companies, maybe the drivers or the hosts i can't remember if airbnb had one or not, but kind of get people involved in the ecosystem more involved in the ipo and participate in what they hope would be an upside depending on how the stock trades. >> other companies in the so-called batter's box for this time we've had reddit on for a couple years and talked about this day. >> i can only think of a handful of names neiman marcus on file. i don't think they went out. i think they were bought by private equity that's a deep part of my brain i can't remember right now yeah, it's very rare for something to be on file and to know confidentially filed for this long. sometimes companies file confidentially and don't know about it to know they were on file since december 21 and the market has took a turn, the rate environment shifted dramatically since then and they were waiting
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for a more opportune moment. >> it's going to be interesting. >> definitely. let's bring in bob pisani here on what this means for the ipo market as a whole. perfect segue, bob do you think this is the watershed moment that people were anticipating that a company that's been on ice for the better part of two years now finally decides to dip its toes into the public markets? >> yeah. i'm excited for the ipo market in 2024 because the stock market is very supportive of a strong ipo market i'm also excited about ai, and its potential impact on the ipo market not excite cited about reddit. strong market helps ipos a lot the crop of ipos in the last since 2024, have really improved dramatically in the last few weeks as the s&p has moved up. look at the names, smith douglas, amer sports started off rocky and stabilized american health care
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brightspring a good start and the ipo etf is flat on the year down 8% a couple weeks ago the reason i'm not terribly excited about reddit the valuation problem. the company is old founded in 2005, filed paper in 2021 originally they were talking about valuations of about $15 billion back in 2021 today, well, we don't know, but the valuations are a fraction of that, for example. we're talking about close to potentially $5 billion this is the classic valuation problem that you've got with companies stay around too long and circumstances changed a lot. i'll tell you what i am excited about, potential ai ipo filed this week and nobody paid attention to it. astro labs this may be very exciting here a semiconductor maishg they remove data center bottleneck and allow data to move around at higher speeds in the big data centers this is an important ai application. they just filed. they have a valuation of $3 billion just this week i don't know when they're going
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to go public but this is to me the first ai ipo out there there's a lot of tech ipo-ai stuff that's floating throughout that hasn't happened yet that could accelerate now that we have this movement here. you have data bricks who do cloud analytics, rubric does cloud data management, backed by microsoft. discord, that's the chat service, the video chat service, and wiz does cloud security. you could get an acceleration with the ai-ipos that could juice the ipo market finally the other runones out te like red that's have general uses dell monty has been out there parks neera read, seatgeek and shein have been out there. so carl, leslie, i don't know. i'm excited about the market moving up, excited about ai, and its impact on the ipo market i hope reddit does well because it's a good sign for other
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companies like this one. it's going to be a lot about tech this year. >> bob, thanks good summation of where we are at 150 -- 5107 nvidia topping $29 trillion stock after giving stocks -- $2 trillionto ts sckhiweek we'll discuss with dan ives of wedbush in a couple minutes. so this is pickleball? it's basically tennis for babies, but for adults. it should be called wiffle tennis. pickle! yeah, aw! whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free.
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welcome back to "squawk on the street." i'm dominic chu with your cnbc news update. president biden unveiled more than 500 fresh sanctions against russia this morning over its war in ukraine and the death of opposition leader alexei navalny. the sanctions target russia's financial sector and moscow's military industrial complex. former president donald trump asked a federal judge to throw out his classified documents case in florida, arguing he has presidential
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immunity from the charges. an appellate court rejected his immunity agreement this month but it could land in front of the supreme court if justices decide to hear trump's appeal of that decision. and some spectators at the paris olympics will watch the games from recycled seats. a french company is designing 11,000 seats for two olympic venues made from 100 tons of recycled plastic you will see the seats in the aquatic center and adidas arena which will host bat mitten and rhythmic gymnastics events nothing like bat mitten to get me fired up. >> carl. >> just a few months away. thanks. >> meantime nvidia on pace to end the week 10% higher lifting tech stocks with the nasdaq off the best day since january of last year. our next guest says the blowout quarter was jet fuel for the tech bulls and the popcorn getting started on the ai revolution is a secondary players begin to benefit over the next year.
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here to discuss at post nine, wedbush's dan ives happy friday great to see you. >> you keep using 95 as an analog for where we are right now. can you talk about that. >> not 99. >> right. >> that's the important thing, is that because of the monetization the spending that's happened with the godfather of ai and jensen and nvidia that's just the start. now the second and third and fourth derivatives we think for every dollar of spend on a gpu, there can be a multiplier 10, $12. you think about that multipliers into software and chips i believe the ai party has begun. >> are you going to ignore any kind of inventory corrections even if they're short and shallow on a quarterly basis and just ride this for the next five years? >> look, i'll be in asia the next two weeks and we have to navigate around it you have supply issues, regulatory, but ultimately, we look to where this is all going we're -- i would say we're in the dugout to first i think.
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>> not even the batter's box. >> relative to the overall ai revolution, and even though we start to hear from the godfather of ai, jensen, you see what's happened in redmond, what's happened at google, amazon, names like palantir, who is the second, third, fourth derivative, which is why we believe the tech bull market has a lot of legs going to 24, 25. >> can you, plain the multiplier effect for our viewers and where you see that sure. >> also kind of the timeframe by which it filters through that's important here given just the, you know, as you mentioned, we're in the batter's box of monetization how soon can you really see that multiplier effect trickle into earnings >> that's why cramer talks about a power swift moment for t-- taylor moment for tech, because if you look at the dollar for gpus, co-pilot, microsoft, what does that do to what's happened in redmond
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we saw that in the earnings. the use cases. how are you deploying the use cases. palantir, snowflake, you start to go down the list. the multiplier for every dollar of gpu now it's the software ecosystem. this is going to bring a tidal wave to spend on software for i would say infrastructure and then you look at services. that's why a lot of these stocks, people talk about it's a bubble 99, i disagree. some of the covered tech stocks back then can't even compare relative to valuations, balance sheets and monetization. that's why the monetization is happening and we believe the ai revolution it's a get out the popcorn moment i'm not saying you're not going to have little speed bumps here and there relative to where we see this year. >> more broadly, within mag seven, there's discussion today about tesla, apple under performance within that group. how are you thinking about that? >> i think for apple, we're just about to get that renaissance of growth
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i talk about iphones is just the tip relative to on the services side, and we believe the ai app store cook will unveil at wdc and ai in terms of exclusive llms in iphone 16, this is now going to be the renaissance of growth at apple for more of an ai perspective and iphones, we continue to believe, not roses and champagne in beijing, but we're starting to see a stabilization post the new year. tesla, look, this is -- it's definitely a white knuckle period but we continue to believe on the other side of that, is the growth, is the ai piece, is the demand, where i still believe right now the street, you know, i think underestimating where demand could be. >> at these levels would -- you have a buy rating on nvidia. would you recommend people still be buying at these levels, or would you recommend they kind of wait for more of a pullback? >> we believe you're talking about a company that ultimately could be $3 trillion when you start to look at where
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this is all heading, as right now they're the only game in town that's why jensen with a black leather jacket, godfather of ai and it's not just about nvidia could that hit four digits what could happen happy to the rest of tech nadella and redmond. this is a massive boom google i could argue, alphabet, underestimated what that could do from a cloud perspective. look across software, i think that's why this is the most important week, probably the most important day we've had of earnings in many years, not just because of nvidia, it's because of what it means for broader tech. >> we'll get more clues about some of that with snow and other names. >> yeah. >> you're going to be traveling a bit. >> we will be in asia for two weeks on the ground and i believe that's just another sort of feet on the ground to see this revolution playing out. >> look forward to checking in when you get back. dan ives this morning. >> from big tech to big energy, pippa stevens is taking a closer look at what these two sectors have in common pippa, where do you see the overlap? >> well, leslie, one common
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overlap here is a hefty shareholder payout with tech and energy companies topping the list when it comes to capital returns. within the s&p 500, apple takes the top spot with $98 billion paid out via dividends and buybacks over the last year according to data from iq. alphabet and microsoft round out the top three with exxon taking the fourth spot at $32.7 billion returns to shareholders. chevron is close behind at number six but when you look at returns relative to market cap, big energy tops big tech exxon's distribution stands at 7.9% of its market cap with chevron at 9%. that compares to apple and alphabet's 3.5%. now across the s&p 500, the energy sector has the highest overall yield followed by utilities and real estate and within the energy sector itself players are the largest payers with marathon oil, coterra and
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apa coming out on top. while we're talking about market cap, get this, microsoft, apple, nvidia, amazon and alphabet are now each larger than the entire s&p energy sector. carl, quite a stat there. >> amazing and a lot more information still to come. thanks pippa stevens. after the break, warner brothers discovery shares plunging post results. we're going to break down that quarter as the markets are langing in there with the s&p holding 5100, as we mentioned earlier was goldman's year end target until they upped it a few days ago our contributions to the world are significant and you don't know where you're going unless you can look back and see where you've come from celebrating black history month allows everybody to understand, celebrate and recognize the rich contributions that african americans have made in the united states but that black
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the studio has been performing and, you know, including the end the year where we had some real struggle, but we're very optimistic about this year, and it gives us a chance to have a lot of upside in the next two years it was a struggle. >> that was david zaslav, on the earnings call this morning talking about the studio under performing the struggle especially at years end, shares plummeting missing on the top and bottom line partially due to a frail advertising market shares down about 13.5% right now. let's bring in guggenheim's security entertainment and media analyst, a price target of $14 michael, what do you make of today's move and the results
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from wbd >> sure. so, the move in the stock is clearly the topic to be discussed right now. the results themselves were not great, but i don't think they were really surprising the places where the performance in the fourth quarter was a bit softer primarily at that studio setting -- segment the street knew these films under performed and were prepared for the number that came out where people surprised was the lack of 2024 guidance. this is a company that has provided formal guidance for its coming year performance, and not providing that guidance today, i think surprised a number of investors. that guidance is usually ebitda, profitability, free cash flow. the company talked about a number of qualitative factors without the quantitative commitment it's hard for investors to make the commitment. >> is that due to uncertainty surrounding advertising?
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14% decline in linear advertising revenue including changes in fx and 14% drop in distribution revenue does that say something about the cloudiness of the advertising picture and as an analyst how do you model that moving forward given your current buy rating >> yes on a number of things first of all, i model it regardless of what my rating is, and i'm happy to come back to that topic as well the important thing here is that we, the investment community, the media community, we understand that the environment is a challenge we see consumer behavior and advertiser behavior so we know these things in the case of warner brothers discovery they have a plan that plan is to have a direct to consumer business that they are migrating activity into and hopefully migrating economics into right. but somebody at some point has to say, this is what we think we will do in the coming year right. we know there's uncertainty. we can talk to you about some of those uncertain factors, but we
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believe we can perform at level x. if you think about when this company merged, when they created this company two years ago, they provided us with formal outlooks from multiple years for revenue, for ebitda. you have to make those commitments even in the face of uncertainty. so to not do that, it shakes investors' confidence. you can talk about qualitative factors all you want, talk about use the term momentum, but if you don't make the commitment to what you think you can do in an uncertain environment it's hard for investors to be confident in that to answer your question about how i model it, and i'm happy to talk about this, we take a robust view of the market and dig into what's happening in the advertising market at large, with consumer behavior and make our determine anything and think '24 should be better than '23 but think we'll be challenged. >> as far as the qualitative title work, david talked a lot about the superman film, they talked about wonka and harry potter is that enough for any would-be
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bull to chew on? >> i'll say yes. i'll say yes, it is, especially with the stock where it is right now. so let's put a couple things together here. when i think about my buy rating on this stock and i think about the value of this business, a couple of those titles you mentioned, they're indicative of the strength and health of this company. it is one of the strongest producers of content in the world. it's one of the strongest owners of i.p. in the world including the franchises you mentioned if you are going to be successful in this challenging and evolving marketplace at the core you have to have great content and i do believe that foundation is there, and that's why we -- one of the reasons, not the only reason, one of the reasons we've been positive about this stock from there you have to execute you have to make content that's great, even using that i.p. that is commercially successful and you have to have a strategy with respect to how you window that content thee at trickically on your streaming service, whether
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you sell a platform that drives growth and so far, and be in fairness, it was a challenging year in 2023 with the strikes, but this company has not delivered against that okay many media companies, they are not alone but if they want to win and we want to seat stock appreciation they have to hit those marks. >> yeah. of course, one bright spot of the report was that max ended 2023 profitable. we'll see what zaslav is able to do there thank you. appreciate your time today. >> thank you still ahead, chinese stocks bouncing back following a rough start to the year. we're live in beijing next plus, jamie dimon the latest ceo to sell some stock theater we -- this year.
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123450u chinese markets rebounding over the last couple of weeks with the government's new campaign making sure these recent gains are here to stay. eunice yoon is in beijing to explain. pretty interesting measures rolled out the last week or two. >> absolutely. behind that is a campaign, as you just mentioned the government is promoting what it calls a financial culture with chinese characteristics
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the principles, as described by the communist party papers, target short-term profit taking, which the leadership here now appears to believe is immoral. the campaign argues profits should only be made through righteousness. investors should not seek quick success and immediate profits and finance shouldn't stray from the real economy now, if investors don't adhere to this guidance, then the authorities are imposing it, as carl just mentioned, this week the financial authorities had punished one major quant fund for selling stocks in addition to that, traders have been reporting big institutional investors have been stopped from -- ordered to stop from selling at the open and close of trade now, when asked about these reported bans, the stocks regulator said it -- it said that the authorities don't
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interfere with what it described as normal transactions, but would crack down on illegal activities that disrupt market order. so, it didn't confirm or deny those reports. today, though, the regulator went one step further, vowing more severe penalties for stocks trading violations, including longer prison terms. guys >> eunice, what kind of signal do you think this sends to global institutional investors that may be looking to expand into china that's seen, at least in hedge fund communities, certain profits of private equity, but that seems to some managers, at least, as a pathway to growth. is this a signal to them to kind of stay away >> i can tell you what the signal has been to the domestic investors. and that has been a lot of confusion as well as concern people aren't really sure whether or not these measures are going to be very effective
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just because of all the uncertainty they create. they don't fundamentally address one of the bigger issues, which is that there's a whole lot of investor gloom going on here >> it seems like definitely an inflection point for the markets there. eunice, thank you. eunice yoon. jpmorgan's ceo jamie dimon sold about $150 million of his shares in the bank, according to an s.e.c. filing part of a predetermined plan from october that was laid out in october where dimon indicated plans to sell a million shares yesterday's filing amounted to about 80% of that million he could have sold, based on that predetermined plan, or about 82,000 shares. this is the first time dimon has sold shares since taking charge in 2005. the stock up nearly 400% since then i just double checked with a source, nothing had changed since october. this isn't a reflection of dimon's view on the stock or
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indicate plans to step down from the c-suite. there's no succession read through here i'm told that's still the case i'll be speaking exclusively with jamie dimon monday at 12:00 p.m. eastern here on cnbc. >> it's going to be such a key interview. there has been some executive shuffling at the bank lately he always gets asked about his own view macro wise, geopolitics, markets, risks, and how the house view within jpmorgan has had some back and forth between the quants and even the trading desk, which has offered a bit of mea culpa for being too bearish. >> that will be part of the conversation we haven't heard from him on this recent regional flareup we've seen it will be great to get his perspective on that, great to get a sense of his thoughts on the whole capital one/discover situation, what that means for trades, which right now it's the biggest car issuer -- or jpmorgan is the biggest car issuer that could fundamentally reshape one of the key areas that they operate in as well. >> it's going to be great.
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dimon monday, of course, at noon eastern time. coming up after the break, don't miss the ceo of carvana. stock is surging post results after its first annual profit as "money movers" begins in a minute ♪ upbeat music ♪ upbeat music
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good friday morning. welcome to "money movers." i'm carl quintanilla with leslie picker of the new york stock exchange meantime, carvana ceo and the cfo of block coming up this hour two of the market's biggest earnings movers this morning. let's start with a look at the overall indexes this morning. you have a nice picture shaping up here. the nasdaq a little bit at the underperformer here, down about 0.10%. the dow up 0.50% >> s&p just south of 5100 after crossing it earlier today as the market digests this nvidia versus fed narrative wealth investment chief officer neil is here good to see you. >> good to see you. >> a lot of discussion abo h

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